It is now clear that the US financial system - and now even the system of financing of the corporate sector - is now in cardiac arrest and at a risk of a systemic financial meltdown. I don't use these words lightly but at this point we have reached the final 12th step of my February paper on "The Risk of a Systemic Financial Meltdown: 12 Steps to a Financial Disaster" (Step 9 or the collapse of the major broker dealers has already widely occurred). [...]

- The run on the shadow banking system is accelerating as: even the surviving major broker dealers (Morgan Stanley and Goldman Sachs) are under severe pressure (Morgan losing over a third of its hedge funds clients); the run on hedge funds is accelerating via massive redemptions and a roll-off of their overnight repo lines; the money market funds are experiencing further withdrawals in spite of government blanket guarantee.

- A run on the short term liabilities of the corporate sector is also underway as the commercial paper market has effectively shut down with little trading and no issuance or rollover of such debt while corporations have no access to long or short term credit markets and they are therefore facing massive rollover problems (over $500 billion of rollover of maturing debts in the next 12 months). [...]

- The money markets and interbank markets have shut down as - despite the Senate passing the bail-out bill - [...]

So we are now facing:

- a silent run on the huge mass of uninsured deposits of the banking system and even a run on some insured deposits are small depositors are scared;

- a run on most of the shadow banking system: over 300 non bank mortgage lenders are now bust; the SIVs and conduits are now all bust; the five major brokers dealers are now bust (Bear and Lehman) or still under severe stress even after they have been converted into banks (Merrill, Morgan, Goldman); a run on money market funds restrained only by a blanket government guarantee; a serious run on hedge funds; a looming refinancing crisis for private equity firms and LBOs);

- a run on the short term liabilities of the corporate sector as the commercial paper market has totally frozen (and experiencing a roll-off) while access to medium terms and long term financings for corporations is frozen at a time when hundreds of billions of dollars of maturing debts need to be rolled over;

- a total seizure of the interbank and money markets.

This is indeed a cardiac arrest for the shadow and non-shadow banking system and for the system of financing of the corporate sector. The shutdown of financing for the corporate system is particularly scary: solvent but illiquid corporations that cannot roll over their maturing debt may now face massive defaults due to this illiquidity. And if the financing of the corporate sectors shuts down and remains shut down the risk of an economic collapse similar to the Great Depression becomes highly likely.

Nuclear attack on D.C. a hypothetical disaster

A nuclear device detonated near the White House would kill roughly 100,000 people and flatten downtown federal buildings, while the radioactive plume from the explosion would likely spread toward the Capitol and into Southeast D.C., contaminating thousands more.

The blast from the 10-kiloton bomb -- similar to the bomb dropped over Hiroshima during World War II -- would kill up to one in 10 tourists visiting the Washington Monument and send shards of glass flying the length of the National Mall, in a scenario that has become increasingly likely to occur in a major U.S. city in recent years, panel members told a Senate committee yesterday.

It's inevitable," said Cham E. Dallas, director of the Institute for Health Management and Mass Destruction Defense at the University of Georgia, who has charted the potential explosion's effect in the District and testified before a hearing of the Senate Committee on Homeland Security and Governmental Affairs. "I think it's wistful to think that it won't happen by 20 years."

Study: Area Not Ready for Nuclear Explosion

WASHINGTON - A new study from the University of Georgia finds the region is not prepared for a nuclear attack.

A nuclear attack is the worst possible scenario -- and even though there are plans for disasters, the study suggests the aftermath would be devastating to relief efforts.

Even if the nuclear device was relatively small, hospitals from Baltimore to Fredericksburg would be non-functional.

The study finds that with the local hospital infrastructure wiped out, there would be millions dead, and thousands wounded.

Kevin Harlan of the Northern Virginia Hospital Alliance says there are plans in place to bring in medical reserves from other regions.

"We would certainly be reaching out to hospitals in the rest of the Commonwealth and of course further down into North Carolina and West Virginia," says Harlan.

However, the reserves could be hard to coordinate with guaranteed travel interruptions from such an event.

The study also suggests that thousands of mobile hospital beds and supplies be stockpiled. However, Harlan says that the mobile hospitals aren't nearly as large and might not be able to handle the number of survivors and wounded that would result from such an event.

The study also looked at a nuclear attack on New York, Chicago and Atlanta and predicted similar results.

The Housing Bubble Blog

It's also one of the few blogs where the comments are probably more valuable than the posts themselves. Sure, you're not going to see a lot of positivity in this crowd ("doom, doom, DOOM!!!"), but the on-the-ground stories from around the country of the sudden collapse of the housing market--which the MSM is only now starting to pick up on--are staggering.

And yes, it helps to be able to read it knowing you're not moving anytime soon and that the combination of your mortgage and home equity loan is just about 50% of your home's value. Call me smug. And of course MY neighborhood's values will NEVER tank! Never!

I'd add the Interest Rate Roundup blog as well, which has in some of it's most recent entries a couple of charts about home sales and interest rates that, to say the least, leap off the page.

(As for Doom-in-the-Near-Future: Hello, Ernesto.)

Telecommunications will likely be overwhelmed early in the pandemic. Some experts speculated that the Internet could shut down within two to four days of the outbreak.

If the flu doesn't kill you, the lack of e-mail will.

I haven't provided much in the way of Doom lately, so here's something:

Is America facing yet another dust bowl?

XXXXX DRUDGE REPORT XXXXX SUN NOV 27 2005 17:05:23 ET XXXXX

NETWORKS PLAN 'END OF AMERICA' SHOWS

The TV networks are getting edgier in their '06 pilot plans.

The nets have filled their development slates with a bevy of brave ideas and bold format experiments, VARIETY reports on Monday, including shows about THE END OF AMERICA!

ABC alone has at least two would-be shows set in post-apocalyptic America ("Resistance" and "Red & Blue") while Gavin Polone and Bruce Wagner are teaming for the comfy-sounding plague drama "Four Horsemen" at CBS (which also is developing "Jericho," about life in a small town after America is destroyed).

Says Fox exec VP Craig Erwich: "The creative community appears to be really inspired this year," he says. "It was an exciting time to be buying. I came away pretty encouraged about network TV."

Developing...

The Doyenne of Doom

Sally Quinn has had a prosperous career as a Washington Post reporter and Georgetown hostess. Now, at 64, she's taking a slight turn toward civic activism. And her cause is weightier than such perennial Georgetown parochialities as the overhaul of the waterfront park and the fate of the neighborhood's trolley tracks.

Quinn these days is counseling her fellow citizens to get off their apathetic asses and prepare for the next terrorist attack. As she wrote in a Sept. 18 Post piece, "We, as a society, must demand a plan, and we must demand that the plan be practiced over and over, for many scenarios, including chlorine tanker attacks, dirty bombs, chemical and biological attacks, fire bombings of subways and trains, even nuclear attacks."

Read the rest. Sally even makes ME say, "Gosh, that's a little excessive...."